FINANCIAL technology (Fintech) company, Chaperone has been on a steady rise since its launch in October 2020. From bagging innovation awards to ambitious targets in the region and globally, the company looks set to make its mark as an innovator. The company has also been selected by Dubai’s Companies Creating Change (C3), a startup accelerator that supports companies looking to do business in the United Arab Emirates (UAE) to be part of the Dubai Multi Commodity Centre (DMCC). In this interview, Lesotho Times (LT) Deputy Editor, Silence Charumbira speaks to Chaperone managing director, Mohau Mochebelele, marketing manager, Hlompho Halele and Lana Azhari, C3’s communications and community manager.
Excerpts:
LT: Many have seen Chaperone branding around but would want to know what or who it is.
Mochebelele: Chaperone is a financial technology (Fintech) company with a broad-based shareholding predominantly Basotho and international investors, mostly from South Africa and Canada. We were licensed by Central Bank of Lesotho (CBL) at the beginning of 2020. However, having launched in the midst of the Covid-19 pandemic, we only started on 1 October 2020. So, in our maiden year we were mostly trying to create confidence within the ecosystem and trying to get corporate partnerships going. We are now in our second year and we have lots of projects and now looking to upscale because we have validated our model into Botswana and South Africa. We have also received numerous awards.
We work with consultants who want to see us grow both locally and internationally. These include the World Bank ecosystem, some companies in the United States (US), Dubai and India.
LT: Please explain for those who may not be in the know, what is the role of Fintechs in a small economy like Lesotho?
Mochebelele: This economy needs Fintechs. If one were to go back in time, they will realise that technology has managed to reduce the cost of doing business. Fintech is an acronym for financial technology. This is the utilisation of technology at its purest to bring financial service to people. It means that what historically was an elite service, that is banking, can now be brought down to the grassroots level. The more people have the more well off we are. So, that is essentially what Fintechs do for society.
LT: How has been the uptake of your services and products in the Lesotho market?
Mochebelele: We have around 100 000 registered accounts. However, our model differs a bit from that of existing mobile money ecosystems. We are predominantly business to business solution (B2B) and that is how we measure our traction. So, today we are partnering with constitutions mostly banks and also telcos; we distribute some of their services and they also gave us their technology rails for our services to operate. But here and there, you find that in some companies, especially in the financial services space, there is still quite a need for the financial services that we offer and to date, the insurance space has embraced Chaperone. More institutions and corporates will be onboarded in the different industries.
LT: For a company that was registered by the Central Bank in 2020, I suppose there was a lot of background work that was happening in the last few years. You are also talking of Botswana and other markets. What are your growth targets?
Mochebelele: When we started out, we were quite broad-based both locally and internationally. There was a sense in the company to say that I think we are onto something here, we need to validate it and when it takes off, then we should immediately start looking into other markets. At the end of the day, the African demographic is almost the same. If you go to Botswana, although there will be different cultural nuances, we are the same people. Even a more robust market like South Africa, the moment you leave the likes of Sandton, you will find that the demographic is the same. The beauty about technology is that it goes beyond borders and if you don’t do that, you may lose to organisations that are not even present here. People are using PayPal and Cryptocurrencies, but they don’t even have establishments here, so, in as much as it’s a growth opportunity, it’s also a survival strategy.
LT: What are your expansion targets?
Mochebelele: Each market warrants a different approach. Let’s take South Africa as an example, the plan is to enable Basotho living there to remit money home. When the money gets home, it can be utilised within the C-Pay wallet. You also understand that half of household incomes in Lesotho comes from remittances. So, if you don’t have a strategy for remittances, it means that you’re losing the mark in terms of any households’ income. That is just to bring in the second link of the whole equation.
LT: Lesotho has a lot of unbanked people, how is the competition?
Hlalele: Currently, the kind of service that we provide are not only for customers on the mobile money platform. We offer different models of solutions and that is where we beat most of our competitors. We are not only focused on the customer-to-customer model, we are also providing them the solutions that they will need in the long run.
Mochebelele: Even from a strategic standpoint, people keep making reference to financial muscle but that is not the only muscle you need. Any strategy has many different pillars and financial resources is one. We may not have the same capabilities but we still beat them on other things. However, for us, it is not so much about competing. We are actually trying to shy away from that narrative, we see ourselves as the link in the chain. When we came into the market, there was a sense that we were competitors, but upon understanding what we do and understanding the augmentations that we are bringing into the market, then banks and other players realised that we were adding value instead of siphoning it.
LT: You have bagged some awards, tell us a bit about those.
Mochebelele: Most of the awards have been around innovation and how we separate ourselves from the competition. So, mid of this year we got an award from a United Kingdom based magazine labelling us the most innovative digital payments platform on the continent. Two weeks ago we were in Kenya having been called to exhibit to the central banks and the banking fraternity on the continent. They were interested in what Chaperone is doing and what we stand for because it is one thing to say mobile money innovated the payments landscape of the continent but an innovation on mobile money also gets people excited. So, we are hoping that excitement will gain momentum.
LT: Tell us about the partnership that you have with a Dubai entity.
Mochebelele: The Dubai government has different free zones… in particular, DMCC is the number one free zone in the world for seven years in the running if I am not mistaken. They are running a programme to support startups around the world. Twenty startups were picked to get into an impact scale-up programme; they are looking for programmes that are scalable and are going to have impact. On the United Nations (UN) Sustainable Development Goals (SDGs), we focus on SDG 1, 8 and 9. So, they are looking for companies that are scalable and that are going to have impact and we are going to get support to realise our aspirations for scaling.
LT: How many companies had applied for the programme? How many were accepted?
Azhari: The DMCC Impact Scale-Up Programme received 78 applications from across the world and 15 startups were accepted into the programme. The applications were assessed according to a set of criteria including impact scalability, presentation quality, financial sustainability, and commitment to expanding into the UAE by setting up in the DMCC. Chaperone performed well on all these parameters and have shown a real drive to expand their business to the UAE and region.
The programme is the first of its kind in the UAE, supporting the growth of impact-driven businesses that align with the UN Sustainable Development Goals, which falls under C3’s strategy, a UAE-based social enterprise helping impact-driven entrepreneurs in the region unlock their growth potential and maximise their positive impact on the community.
The 15 impact-driven companies have joined DMCC’s growing community of over 21,000 businesses with substantial savings on business set up costs through a bespoke 70% discount on licence fees and flexi-desk space for two years, in addition to offering further discounts on licence renewal from the third to the fifth year.
The C3 team will support the selected businesses in scaling their impact across the UAE and the wider region. C3’s network of experts, trainers, and investors will help the founders unlock new opportunities and sustainably grow their impact-focused businesses. The selected companies are a welcome addition to C3’s network of over 200 accelerated start-ups, who have benefited from its programs, and more than 2,500 founders committed to put their business to good use.
The businesses founders kicked off their training with C3 in September, where they are receiving expert support on various pillars including impact, strategy for scaling, business, governance, talent and doing business in the UAE. The selected companies will be prepared to meet investors and potential partners from C3’s network of 4,000 senior experts, clients from blue-chip companies, as well as over 150 investment firms.
LT: Speaking of aspirations, what are your aspirations in Lesotho?
Mochebelele: Our aspiration is to fill the gaps as in any other market. Lesotho is usually a forgotten market. Our geographical constraints make everybody forget about us. Literally, people think Lesotho is a province of South Africa. The reason is that most of the big players in Lesotho’s economy are predominantly South African. However, innovations made in South Africa do not always make it onto Lesotho soil. It leaves a very big gap to bring Lesotho to parity with the rest of the continent. But someone has to do it and it has to be us.
LT: How has the regulatory framework supported your cause? Is it as dynamic as you want to be?
Mochebelele: To be honest, our regulator has a lot of foresight. The regulator has been really supportive and if you are a company working in a certain jurisdiction, that is what you want. Being regulated also has its own merits in the sense that you are forced to think about things that you didn’t even know going into whatever business you’re going into. So, the regulatory has been supportive, they have the systems in place, the private sector just has to take advantage of those systems.
LT: In terms of marketing, your growth has been largely generic with no robust marketing.
Hlalele: It is working wonders for us because our competitors are already scared of us. The more we stay intimate, the more they think we are not working but our results scare them. I think it is working for us.
